Chip stock Intel (INTC) has been on a roll lately. First there was the deal with Tesla (TSLA), and then the preliminary deal with Apple (AAPL). Now, new reports suggest that Intel is looking to make deals with another major name in computing, SK Hynix (HXSCL). This latest push into revenue for Intel definitely caught investors’ attention, and they sent Intel shares up nearly another 3% in Monday afternoon’s trading.
Claim 55% Off TipRanks
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Discover top-performing stock ideas and upgrade to a portfolio of market leaders with Smart Investor Picks
The new reports assert that Intel and SK Hynix are currently discussing chip-packaging technology to help put together both high-bandwidth memory and logic chips. This would call upon Intel’s embedded multi-die interconnect bridge (EMIB) system, which Intel has been eagerly presenting as an alternative to Taiwan Semiconductor (TSM) and its chip-on-wafer-on-substrate (CoWoS) system.
TrendForce took a look at the notion and pointed out that EMIB takes out the need for interposers, which are big and costly systems that can get in the way of production. Meanwhile, using EMIB makes chip structure simpler, and also boosts yields in manufacturing. That is a huge plus in a time when every memory chip has a buyer before it is even produced. But EMIB does not come without drawbacks, the report noted, like bandwidth constraints and greater transmission distance.
Elon Musk on Tour
Meanwhile, Tesla CEO Elon Musk hit the road to go to Oregon and check out Intel’s semiconductor fabrication plant in Hillsboro. Musk declared it “…an honor to be shown the awesome Intel fab…,” and noted he looked forward to a “…great partnership with SpaceX and Tesla!”.
Musk had every reason to go out for a tour. Just weeks ago, Intel announced plans to get together with SpaceX and Tesla to create a new chip production plant, the Terafab, in Texas. The project is set to cost about $120 billion, reports note. Tesla will have access to a steady supply of chips, particularly those used in artificial intelligence (AI) applications.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on 11 Buys, 23 Holds and three Sells assigned in the past three months, as indicated by the graphic below. After a 463.21% rally in its share price over the past year, the average INTC price target of $81.41 per share implies 36.22% downside risk.
